Compiled 01/21/11 6:00 AM (CT) Statistics: London Gold Fix $1344.00 -$20.50 LME Copper Stocks 381,300 tons +775 tons Shanghai Deliverable stocks were 130,364 tons -2,283 tons GOLD MARKET FUNDAMENTALS: (6:00 AM CST) With the February gold contract making a fresh new low for the move in the early Friday US trade action, that would seem to leave the bear camp with a slight technical edge. In fact, European press coverage of the slide to the lowest price levels since November 18th, has seemingly given the bear camp an added measure of resolve this morning. Some players suggest that an improvement in US weekly claims readings yesterday have tamped down the flight to quality standing of gold and that theme might prevail all day today because of a lack of fresh scheduled US data. Apparently gold was presented with a bearish Wall Street Journal article that questioned the duration of the bull market. Adding into the negative tilt in gold prices this morning is lingering fears of weakness in a long list of physical commodity prices and suggestions from Gold Fields Mineral Services, that the gold market won't see much support from implied demand from hedge lifting in 2011. Apparently, Gold Fields in a report released earlier also predicted gold prices would still rise to $1,600 an ounce this year because of global inflation pressures. However, in the short term, the gold trade seems to be concerned about a slumping of physical demand and that argument might have been given some added credence this morning because of a weaker gold trade in India. With the US economic report slate empty today, gold might not see much impact from the currency markets and that in turn could mean that the action in the US equity markets will be a key focal point today. It is possible that the bears might try to push gold prices down further off a technical argument, or it is possible that news of higher quarterly gold production from DrdGold, will give the gold bears some additional resolve today. Comex Gold Stocks were 11.720 million ounces down 1,190 ounces. Gold stocks have declined 12 of the last 20 days. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) While equity markets in Asia were mixed during overnight trading, stock indices in Europe are generally higher this morning. Early indications are for the US stock market to open near unchanged levels this morning. The Dollar is weaker against most of the major currencies during overnight trading, although posting a small gain versus the Pound. Spain is planning to nationalize several of their cajas savings banks if they are unable to find new investors. South Korea has agreed to high-level military talks with North Korea in order to diffuse tensions between the two nations. A private survey of German Business Climate during January was 110.3, higher than expectations and reaching a new record high level for the second month in a row. UK Retail Sales during December were down 0.8%, lower than forecasts. There are no major US economic numbers to be released this morning.
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